I wonder what these guys present in budget if they cannot follow it up during the year.
Re: Economic survey: no economic target achieved in 2011-12
Nothing new bru it happens every hear sadly
Re: Economic survey: no economic target achieved in 2011-12
I am sure at least some cabinet members achieved their personal financial goals.
Re: Economic survey: no economic target achieved in 2011-12
Now statebank saying that due to the incompetence of the government Pakistan will have to return to IMF from next year, more tough times ahead for the country and good ones for the ones in power.
Dunya News: Pakistan:-No option except IMF assistance: SBP …
The government will have to repay 4 billion dollars next year (due to the massive borrowings during the current tenure), on the other hand exports are dwindling due to energy shortages and high cost of doing business (electricity rates and raw material costs).
Re: Economic survey: no economic target achieved in 2011-12
3.7% growth with all the problems is still significant and healthy, i don’t know what you guys are looking for.
ok granted we need over 6% growth to proper pair with our population growth, but well people control your population growth
Re: Economic survey: no economic target achieved in 2011-12
Can some one get me a few figures only with authentic sources .
1- GDP of Pakistan
2- Tax Collection or Revenue collected in Pakistan.
3- the break up of this Revenue , region wise
Note I just want the figures , not the wiki articles with claims and counter claims , also the source of those figures .
Re: Economic survey: no economic target achieved in 2011-12
Pakistan ‘heading for new financial crisis without reforms’ | DAWN.COM
Pakistan ‘heading for new financial crisis without reforms’
http://dawncompk.files.wordpress.com/2012/05/hafeez-shaikh-afp-670.jpg
Finance Minister Abdul Hafeez Shaikh. — Photo by AFP
ISLAMABAD: Minuscule tax revenues, mismanagement and overgenerous subsidies mean Pakistan is heading for a new financial crisis, say diplomats and analysts, with this week’s budget unlikely to offer any respite.
The budget deficit stood at 6.6 per cent of GDP last year, according to the central bank, the State Bank of Pakistan (SBP), which warned that government borrowing was crowding out the private sector from access to credit.
That reduces the prospects for economic growth in a country that is on the front line of the war against al Qaeda and where more than 5,000 people have been killed in bomb and gun attacks by insurgents since 2007.
External forecasts for the current fiscal year see the budget deficit rising to about seven per cent of GDP, while economists warn the government is running out of ways to fund it — and reluctant to embrace reform with polls looming.
Some see little alternative to a major financial crisis or a return to the IMF, which bailed out Pakistan with an $11.3 billion loan package in 2008 that stopped last November after Islamabad rejected strict reform demands.
“I think it’s possible they could have a real financial crisis by the middle of this year or the fall. I don’t think it’s a question of if, but when they go back to the IMF,” one Western diplomat said.
Pakistan’s tax revenues are among the lowest in the world at just 9.8 per cent of GDP in fiscal 2010-2011, says the Asian Development Bank, and less than two per cent of the population pays tax on their income.
On top of this, the government shells out huge sums on electricity subsidies — about 1.5 per cent of GDP in 2010-11, according to the IMF — for a sector so blighted by mismanagement that most of the country suffers crippling power cuts.
Pakistan has also missed out on payments from the United States for its efforts to fight militancy under the Coalition Support Fund (CSF).
This brought around $8.8 billion into Pakistan’s coffers between 2002 and 2011, including $1.5 billion in 2009-10, but Islamabad stopped claiming the money as ties with Washington collapsed in the wake of the raid that killed Osama bin Laden last year.
“There’s not really any money coming in, and that being the case, the government is financing itself by borrowing from the local banks and the local banks aren’t seeing deposits coming in to keep up,” said Liz Martins, an economist with HSBC.
The pressure on finance houses “means they have very limited money to lend to the private sector,” she said.
“There’s no money coming from the IMF, no money coming from the bond markets, and international investors are very cautious.”
Islamabad borrowed 365 billion rupees ($4 billion) from the banking system — both private banks and the SBP — in the first half of the current financial year, the central bank said in its second quarter economic report.
With inflation already running at around 11 per cent, the alternative of printing money to pay debts opens the way to the nightmare of hyperinflation.
The IMF says Pakistan needs to raise tax revenues substantially to reduce the deficit sustainably, but with an election due within months analysts do not expect Finance Minister Abdul Hafeez Shaikh to follow its advice in his budget on Friday.
“I don’t think the government is able to bear the terms that come with going back to the IMF,” said Sartaj Aziz, former finance minister and vice chancellor of Beaconhouse National University.
The situation was already serious, he warned. “The total expansion of currency is higher than ever, so it is already reaching dangerous levels. It has to be arrested by drastic remedial measures,” he said.
Officials from the finance ministry were repeatedly contacted by AFP, but declined to comment on how they planned to finance the deficit.
In Pakistan, once a general election is called, an interim government takes power for three months while campaigning is under way and Aziz said he thought this would give the government a way to duck difficult budget decisions.
“I think the government will be happy to wait until the election is called and hand the problem over to the caretaker government,” .
Re: Economic survey: no economic target achieved in 2011-12
/](http://dawn.com/2012/05/30/pakistan-heading-for-new-financial-crisis-without-reforms/)
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Pakistan’s GDP is 488 billion dollars, according to world bank report it’s 176 billion dollars I don’t know why it’s so different, maybe some economist on board can shed some light.
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Pakistans GDP to tax ratio is 9.8 % and the tax target for this year was almost 2 trillion rupees
Punjabs GDP is over 50% of Pakistans see page 2 of the document http://www2.adb.org/Documents/Tranche-Releases/PAK/32264/32264-PAK-PRTR.pdf
Re: Economic survey: no economic target achieved in 2011-12
I think the difference between gdps is the difference between real and nominal gdps so which one do we use (for example to check the GDP to debt ratio).
Re: Economic survey: no economic target achieved in 2011-12
A lot of these hypes are trumpeted without looking at the actual picture.
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There is a lot of hype that over all borrowing of the government has increased from Rs 6 trillion in 2008 to Rs 12 trillion in 2012 ( Imran Khan states this on every TV channel almost every night). You have to consider that Rupee has depreciated from 60 to 92.. therefore in dollar terms the borrowing has increase from about $ 100 billion in 2008 to $138 billion. Pakistan’s public debt stands at 60% compared to Germany 82%, France 86%, Italy 120%, Japan 229%, USA 104%, UK 82%, India 64%..
List of countries by public debt - Wikipedia, the free encyclopedia -
Our financial sector is robust.. still lending to the government. In case of most of the developed countries the financial sector is almost bankrupt and their governments had to inject money to rescue them..
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Pakistan’s foreign remittences through banking channels will cross US$ 14 billion this year. Our State bank buys another US$ 7 billion cash from open market for the remittences which arrive in the shape of cash/hundi. The total net inflow available through this resource is US$ 21 billion after accounting for the net capital flight and certain imports. Our exports are exceeding 25 billion. On net current account front we can very well finance our import bill of US$ 32.71 billion and still spare money to pay off our foreign debts.. Our numbers on this front are very strong.. and there is no possibility of any default.
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Contrary to India we do not depend on foreign direct investment. Just this year the foreign investments have dried off in India and they have a severe current account balancing problem with their rupee depreciating from Rs. 42/ to Rs 56/ (33% devaluation) just in one year.
We have a management problem in this country.. Numbers are not that bad.. Presently our government could not manage energy sector properly.. and that too is mostly a problem of lobbies and bad prioritization of resources..
There is no need to panic with all these real facts instead of fictions and propaganda against our country..
Re: Economic survey: no economic target achieved in 2011-12
^ even if we consider the inflation the borrowing has increased from 100 to 138 billion dollars, do you think thats normal? In the mean while our foreign debts have also increased from 40 billion to almost 65 billion dollars. That means our combined debt in 60 years was 140 billion dollars which has jumped to 203 billion dollars (jump of 65 billion dollars) in four years, and still no visible sign of improvement.
Re: Economic survey: no economic target achieved in 2011-12
^ even if we consider the inflation the borrowing has increased from 100 to 138 billion dollars, do you think thats normal? In the mean while our foreign debts have also increased from 40 billion to almost 65 billion dollars. That means our combined debt in 60 years was 140 billion dollars which has jumped to 203 billion dollars (jump of 65 billion dollars) in four years, and still no visible sign of improvement.
You have to see debt as a percentage of GDP.. It is the cumulative total of all government borrowings less repayments that are denominated in a country's home currency. Total Debt has grown from US$100 billion to US$138 billion (12 trillion rupees). That's an increase of 38% and 38 billion dollars. I don't know from where you got your 203 billion dollars. And a lot of this increase in debt is not physical borrowing by the government but just recalculating the foreign debt at today's dollar/rupee parity. It's true we are not getting cheap foreign loans due to the strategic reasons you are well aware of.. the government is borrowing mostly from domestic financial sector putting pressure on liquidity position and interest rates..
If you see the chart from the link I have posted.. Debt is not a big problem for Pakistan. The main problem is the debt servicing due to high interest rates. If somehow the interest rates can come down like in Mush era.. it will release a lot of stress from the government and can give an extra boost to the productive sector..
Like I said our numbers are not bad.. we have a management issue in Pakistan..
Re: Economic survey: no economic target achieved in 2011-12
203 billion dollars I added up the internal loans 138 billion and external loans 65 billion dollars. What ever Pakistan earns about 60 percent goes out to military and debt servicing, I don't know what impact would be when the debt servicing increases exponentially from next year. Even the tax to GDP ratio of Pakistan is amongst the lowest in the world (maybe even less than sub Saharan Africa).
Re: Economic survey: no economic target achieved in 2011-12
US$ 138 billion is total including internal and external debt.. In rupee terms it's 12,000 billion rupees..
Tax to GDP ratio is another debate.. yes our government has failed to raise taxes directly from the people.. but they tax you by printing notes which you can see as inflation. People have a choice.. either to finance the government by giving taxes or to pay indirect tax in the shape of inflation..
Low taxes does not mean our government spending is less.. they will somehow find the money either from borrowing or from printing notes.. don't worry these financial wizards working for the government are very clever as far as raising money for government expenditure is concerned..
Pakistan government is no exception.. it happens every where in the world.. the only exception is the prioritization of this expenditure which is wasted in public sector losses/non-developmental expenditures..
Again I am telling you.. despite of lack of FDI our numbers are not bad.. we have a management issue in this country..
Re: Economic survey: no economic target achieved in 2011-12
^ agreed! Some other forms of taxation that they have been using for the past few years is through increasing price of fuel, and electricity (fuel surcharge the latest one to repay the circular debt, I don't know how much they have paid the IPPs but certainly they have cleaned the pockets of the public) etc. I have no doubt that most of the problems of Pakistan will go away with better management.
Re: Economic survey: no economic target achieved in 2011-12
^ even if we consider the inflation the borrowing has increased from 100 to 138 billion dollars, do you think thats normal? In the mean while our foreign debts have also increased from 40 billion to almost 65 billion dollars. That means our combined debt in 60 years was 140 billion dollars which has jumped to 203 billion dollars (jump of 65 billion dollars) in four years, and still no visible sign of improvement.
there is a change of policy few years ago. Government stop borrowing from International Lenders, the great part is our Financial System is powerful enough to provide liquidity and also absorbing the massive money print by Gov.
Given Pakistan underground economy is bigger then documented economy and tax to GDP ratio is stood at 9.7% i am only seeing great potential to become one of the healthy and rich country in two decades if we have best Leaders on top to down.
Also control the population or urbanize your cities on massive scale look at NY, Tokyo & Istanbul.
i wish.
Re: Economic survey: no economic target achieved in 2011-12
there were no economic targets set to begin with :(
Re: Economic survey: no economic target achieved in 2011-12
Hafeez says: 3.7% growth rate was achieved, compared to the last year 3%
now, Im sorry to say but this is not a big achievement! :(
Re: Economic survey: no economic target achieved in 2011-12
^ the positive growth is due to bumper crops the last year, otherwise the dismal performance he has blamed on international crisis and floods (which could be avoided if they had impover the bunds during the past year).
Re: Economic survey: no economic target achieved in 2011-12
Thank you Yazdi for providing clarity/comfort in this thread.